No guarantee Schmidt will sell all those shares, but opening the door to $2.5B could be seen as Schmidt beginning to 'cash out a little'

Google executive chairman Eric Schmidt may end up selling 42 percent of his shares in the company under a new stock trading plan designed to diversify his investment portfolio.

Schmidt owned approximately 7.6 million shares of class A and class B common stock as of Dec. 31, 2012, but in November he adopted a trading plan giving him the option to sell up to 3.2 million shares of class A common stock. That plan became active this month, the company announced Friday in a filing with the U.S. Securities and Exchange Commission.

The trading plan is designed to allow Schmidt to diversity his investment portfolio and spread stock trades out over a period of one year to reduce the market impact, the filing said.

The 7.6 million shares owned as of last December represented 2.3 percent of Google's outstanding capital stock and about 18 percent of the voting power, the company reported.

Based on Friday's closing price of $785.37, the sale of 3.2 million shares would bring a whopping $2.5 billion.

Though there is no guarantee Schmidt will sell all those shares, the plan could be seen as Schmidt beginning to "cash out a little," said Greg Sterling, senior analyst with Opus Research.

In fact, "I wouldn't be surprised if he departs within 12 to 24 months," the analyst said.

Schmidt basically acts as an ambassador for Google with foreign governments, so it would be a natural step for him to leave and pursue a more official role as a U.S. diplomat or ambassador, Sterling said. In a closely watched move last month, Schmidt went to North Korea and met some of the country's leaders, though he called the trip a personal one.

On the other hand, Schmidt, who served as Google's CEO from 2001 to 2011, could just coast with his remaining stock even if he sold the 3.2 million shares, Sterling added.

Google will put out a separate filing with the SEC if Schmidt does sell off shares.